India CFO Survey 2012
Gearing up for the journey ahead
Even though the Indian economy has been fraught with manifold issues in recent times – dipping economic growth, high interest rates, wobbly markets and an uncertain global environment - most CFOs view 2012 with optimism and hope. The global economy seems to be picking up, albeit slowly in this year. The U.S. employment scenario is seen to be improving as consumers’ sentiment is slowly picking up. Japan is likely to pull out of the recession this year as post-earthquake reconstruction efforts are in full swing. China’s growth is likely to be constant and Europe, currently in a spot of trouble, is likely to make economic progress with Greece and Italy advancing towards genuine economic reforms under their new governments.
In India too, recent reports on a rebound in industrial growth has brought relief to all, especially policy makers, who had begun to worry whether their battle with inflation and an adverse environment had stifled growth. In fact, in January, the Manufacturing sector grew at its fastest pace in eight months as factory output surged due to increased domestic and foreign demand. Figures released by the government in January 2012 showed that strong consumer demand has led to a revival in the Manufacturing sector, which makes up for 75.5% of the overall index. The budget has also provided growth stimulus to sectors like Manufacturing and Infrastructure while the government has attempted to tackle the challenges of high inflation, weakening industrial growth and supply-side bottlenecks via various policy measures.
This has boosted hopes that a broad-based industrial revival helped by consumer demand could follow sooner than later and that India, one of the world’s fastest growing major economies, backed by successful implementation of its policy measures, is on its way to better economic prospects in 2012.